Wednesday, March 10, 2010

GRAINS-U.S. soybeans, grains lower ahead of WASDE

* Markets on edge ahead of USDA supply/demand report

* USDA report to determine fundamental trading strategies

* Brazil soybeans 2010 estimates grow to record high

* Coming Up: WASDE report release; 1330 GMT (Adds information, commment)

By Bruce Hextall

SYDNEY, March 10 (Reuters) - U.S. soybeans, corn and wheat futures eased on Wednesday in expectation of a bearish U.S. government report on world supplies and demand for agricultural products.

The U.S. Department of Agriculture's March World Agricultural Supply and Demand Estimates (WASDE) report is due for release at 1330 GMT.

"Most of the trade seem happy to sit on their hands and wait for the WASDE reports," said Luke Mathews, a commodity strategist at Commonwealth Bank of Australia.

"The real moves are likely to come after the WASDE, as it will help traders formulate their fundamental trading perspectives but, on the other hand, things outside markets are still a big influence. Movements in the U.S. dollar have had a pretty marked effect on prices of late."

The dollar was trading largely steady against a basket of major currencies.

The USDA is expected to trim U.S. soy stocks but leave corn unchanged.

The report will include fresh figures for South American soybean production as well as revised estimates of the 2009 soybean and corn harvests, which were delayed by wet weather.

"U.S. corn and soybean production estimates are expected to be lowered slightly this month, mainly due to wet harvest weather," said Mathews.

Chinese customs data showed the world's top soybean buyer imported 28 percent less of the oilseed in February as many crushers shut down during the New Year holidays.

Despite the fall China is still expected to be a big buyer of soybeans this year but in recent weeks has been switching to buying supplies from Brazil, the world's second largest soy exporter, where harvesting is gathering momentum.

Mathews said the 2009 U.S. corn and soybean harvests would still be at record highs.

He noted the May Chicago Board of Trade corn contract tumbled for the fourth straight session on Tuesday as the market responded poorly to the thought the USDA would raise South Amercian corn production estimates.

Traders were expecting the USDA to trim its estimate of soybean ending stocks for the 2009/10 marketing year to 194 million bushels from February's forecast of 210 million.

Corn stocks were seen mostly flat at 1.720 billion verses 1.719 billion estimated in February.

The USDA is likely to raise its estimates for Argentine and Brazilian production of corn and soybeans because of largely favorable crop weather there.

Brazil's government crop supply agency Conab said on Tuesday the country's 2009/10 soy crop would be a record large 67.57 million tonnes, above the USDA's February forecast for 66.0 million.

U.S farmers are also expected to plant big crops of corn and soybeans this year provided spring seeding in the U.S. Midwest is not unduly delayed by wet weather.

Chicago Board of Trade soybeans for March delivery were flat at $9.41-½ per bushel by 0529 GMT but the May contract fell 0.11 percent to $9.46-½ per bushel.

Corn for March delivery fell 0.42 percent to $3.57-¼ per bushel and the May contract dropped 0.41 percent to $3.67-½ per bushel. Wheat for March delivery last traded at $4.78-½ per bushel while the May contract slipped 0.51 percent to $4.87 per bushel.

A University of Missouri think-tank on Tuesday estimated U.S. farmers would grow the second-largest corn and soybean crops on record this year -- 13.134 billion bushels of corn and 3.213 billion of soybean, just missing 2009 records.

GRAIN PRICES AS OF 0410 GMT Product Last Change Pct Move End 2009 Ytd Pct RSI

move CBOT corn Mar0 357.25 -1.50 -0.42 414.50 -13.81 41 CBOT soy Mar0 941.50 0.00 0.00 1039.75 -9.45 47 CBOT wheat Mar0 478.50 0.00 0.00 541.50 -11.63 43 CBOT rice Mar0 12.77 0.00 0.00 14.57 -12.36 30 US crude Mar0 81.51 Euro/dollar 1.3600 (Corn, soybean, wheat U.S. cents per bushel) (Rice U.S. cents per hundredweight) (Crude $ per barrel) (Editing by Clarence Fernandez)

No comments:

Post a Comment